MONTREAL, QUEBEC--(July 7, 2009) - Thallion Pharmaceuticals Inc.
(TSX:TLN) today announced that it has suspended patient enrollment
in its Phase II trial evaluating TLN-232 as a treatment for
metastatic melanoma, due to an ongoing dispute with the licensor. A
binding arbitration proceeding has been initiated and Thallion will
re-evaluate the status of the program based on the outcome of the
adjudication.

"Based on our experience with this licensor, it is in the best
long-term interests of our shareholders to suspend development of
TLN-232 as opposed to investing additional resources to develop the
product under recurring allegations of breach from the licensor and
ensuing disputes over a termination of the license," said Lloyd M.
Segal, Chief Executive Officer of Thallion Pharmaceuticals Inc. "We
believe that the assertions made against us under the license
agreement are without merit. We will vigorously defend our rights
in this matter, and we intend to pursue claims of our own against
the licensor during the proceedings. We believe this decision
represents the most responsible course of action and is especially
prudent in light of today's constrained capital environment."

About TLN-232

TLN-232 is a novel seven amino-acid peptide with potential
efficacy in multiple oncology indications and targets pyruvate
kinase M2 (M2PK), a protein shown to be over-expressed in a number
of different tumour types. The expression of M2PK during
tumourigenesis has been shown recently to mediate the Warburg
effect, a phenotype in which cancer cells utilize the glycolytic
pathway to a far greater extent than do their non-malignant
counterparts.

TLN-232 Phase II Trial

Thallion's multi-centre, open label Phase II trial is targeting
to enroll up to 49 metastatic melanoma patients, who have failed
one prior therapy, at multiple sites in both Canada and the U.S.
The trial design is comprised of a dose escalation segment followed
by a dose expansion segment. The first segment consists of
consecutive cohorts of at least three patients each, who will
receive 0.5, 1.0, 2.0 or 3.0 mg/kg/day of TLN-232 in multiple
cycles. Each cycle will consist of 21 days of treatment and seven
days of rest. Once the optimal dose has been determined, the second
segment of the trial will enroll and treat up to 34 additional
patients at that dose until disease progression. The primary
endpoint of the trial is tumour response at four months.

About Thallion Pharmaceuticals Inc.

Thallion Pharmaceuticals Inc. (TSX:TLN) is a biotechnology
company developing pharmaceutical products in the areas of oncology
and infectious disease. Thallion has three clinical programs at the
Phase II stage of development. The two oncology product candidates
include TLN-4601, a novel anti-cancer therapy targeting the
RAS-MAPK pathway, and TLN-232. TLN-4601 is currently recruiting
patients in a multi-centre, Phase II trials in Canada and the
United States. Thallion's third product candidate, Shigamabs®,
is a dual antibody product for the treatment of Shigatoxin
producing E. coli bacterial infections. Additional information
about Thallion can be obtained at www.thallion.com<http://www.thallion.com/>.

Forward-Looking Statements

This press release contains certain forward-looking statements,
including, without limitation, statements containing the words
"believe", "may", "plan", "will", "estimate", "continue",
"anticipate", "intend", "expect" and other similar expressions
which constitute "forward-looking information" within the meaning
of applicable Canadian securities laws. Forward-looking statements
reflect Thallion's current expectation and assumptions, and are
subject to a number of risks and uncertainties that could cause
actual results to differ materially from those anticipated. These
forward-looking statements involve risks and uncertainties
including, but not limited to, the obtaining of court and other
regulatory approvals and consents, the satisfaction of closing
conditions, changing market conditions, the successful and timely
completion of clinical studies, the establishment of corporate
alliances, the impact of competitive products and pricing, new
product development, uncertainties related to the regulatory
approval process and other risks detailed from time-to-time in
Thallion's ongoing filings with the Canadian securities regulatory
authorities which filings can be found at www.sedar.com<http://www.sedar.com/>. Given
these risks and uncertainties, readers are cautioned not to place
undue reliance on such forward-looking statements. Thallion
undertakes no obligation to publicly update or revise any
forward-looking statements either as a result of new information,
future events or otherwise, except as required by applicable
Canadian securities laws.

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